High inflation spreads to Canada

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High inflation seems to be getting contagious. The UK is suffering, the Eurozone is has recognized it and started to control it while the US is need to start doing something. Now it seems Canada has gone down with it now too.

Canada's consumer price index (CPI) went up by 2.2% in the year to February, so when the figure came in at 3.3% in the year to March the Canadian Dollar jumped a cent higher against the US Dollar in anticipation of higher Canadian interest rates. The increase might not happen at the next policy meeting but it will come sooner than previously expected.

The need to restructure Greek sovereign debt seems to be less of an emergency than investors thought it to be 24 hours ago as Greece sold €1.625 billion of treasury bills yesterday, much more than some had feared. This Greek news managed to restore some of the market's appetite for the Euro as investors started talking once again about rising interest rates instead of sovereign debt. 

For Sterling, Tuesday saw it higher against the US Dollar, the Japanese Yen and the Swiss Franc but lower everywhere else. There was little impact on the markets from yesterday's data; Eurozone purchasing managers' indices were vaguely in line with forecast and US housing starts and building permits were stronger than expected.

Apart from US existing home sales figures this afternoon, all that matters is the minutes of April's monetary policy committee meeting from the Bank of England. 

If you watch the price of Sterling at 9.30am you will be able to see how the voting was split without needing to bother reading the minutes.